The Forbes article published by the author of our textbook, William Conerly gives a dim outlook on the US and even global economy, but provides hope for business owners and managers. Cornerly believes that recent 3rd quarter economic data provides enough detail and evidence to suggest we aren’t currently in a recession with US economic growth still occurring. This is subject to change and he believes recession will hit by next years end or possibly early 2024. the publisher continues to talk about how current personal bank accounts have been spending at a higher rate post-covid stimulous than before, but that is subject to return to normal trends by 16 months. He believes that businesses will respond differently to monetary policy changes compared to the usual trend of laying off workers. Conerly believes that businesses will trend towards finding ways to eliminate new open positions instead of laying off experienced workers, something that goes in line with current labor market demands. All of this leads him to believe the trend of 1 year time lag for monetary policy to effect the economy with a recession as a more believable event than a shorter and upcoming recession. What should businesses do? The publisher completes the article stating the steps business managers can take with a possible time lag seen as beneficial for companies so they can prepare, similar to that of our textbook.
This article touches on so many topics we discussed throughout the semester, but I believe that it hones in on Chapter 6: The Early Warning System: Radar for Business. The article addresses how businesses can and should identify trigger points and how they should manage these points. Creating a contingency plan that has steps in place for the early warning system will allow managers to focus on trigger points and address them head on. This is directly in comparison to how chapter 6 focuses on the early warning system. In Best Practices 11, I wrote about how successful managers are willing and able to accept evidence of changing conditions and how it will protect their companies outlook; which is exactly what Conerly speaks to in this article. Reading when recessions hit is almost impossible, and some managers think we’re currently in recession. If economic data is any indicator, it would prove we’re still growing but at a lesser rate. Managers should use these data trends as evidence that there is time to prepare and protect finances for the upcoming economic recession. Creating communication in management where you can relay these messages and trends down the branches of the business can help your company put in place greater measures to protect against recession. Using the contingency plan in place and even updating it to focus in on industry trigger points and radar warning signs will allow a company to be prepared to even take advantage of recession trends. Our textbook put economics into a more broadened and understanding way. Having real world examples as evidence made these connections to examples like a current looming recession easier to understand. Chapter 6 focused on the early warning system, which seems to be what we are experiencing domestically and globally with the economy.